Climate Change policy: time has come to focus on energy demand
Climate change policy in 2018 should focus on demand-solutions to reducing carbon emissions according to Property Council Chief Executive Ken Morrison.
Morrison was responding to the release of the Turnbull Government’s Review of Climate Change Policies.
According to Minister Josh Frydenberg the Review found Australia has a strong record in meeting its international emissions reductions targets.
“Official projections show that Australia is now on track to over achieve its 2020 emissions target by 294 million tonnes – an improvement of 70 million tonnes or more than 30 per cent compared to 2016.
“Australia continues to close the gap on the 2030 target, with the required emissions reductions over 2021-2030 falling another 122 million tonnes compared to 2016. This means the abatement task has fallen by around 60 per cent since 2015,” says the Minister.
While welcoming the findings of the Review, the Property Council has called on the government to shift its focus away from supply solutions to demand solutions.
“The Government was right to focus its efforts on dealing with the energy supply challenges facing Australia and this Review recognises that work. Now we need that same focus brought to the demand side of the equation”, says Morrison.
“With a framework for supply being developed in the National Energy Guarantee, attention must also be given to driving down demand – because the cheapest energy is energy we don’t use.
“Australia’s built environment accounts for 23% of emissions and there is enormous potential in the built environment to contribute to Australia’s emission reduction targets.
“With the right policies and incentives in place, Australia’s buildings could meet over half the current National Energy Productivity Target (NEPP) and a quarter of the national 2030 emissions target.”
This view is similar to that of the Finkel Review which noted, “there appears to be considerable scope for greater use of energy efficiency to improve reliability, security and affordability” and recommended “Governments should accelerate the roll out of broader energy efficiency measures.”
Morrison says it is good to see the existing policies that support emissions reduction in the built environment highlighted in the Review. The National Energy Productivity Plan (NEPP), Commercial Building Disclosure, and the National Construction Code are important levers for the Government to use in contributing to emissions reductions, as are direct investments by the Clean Energy Financing Corporation.
“However, the government’s centrepiece policy – the Emissions Reduction Fund – does not work for the built environment and is therefore not driving change in this sector.
“This creates a policy gap in a sector where some of the cheapest emissions reduction opportunities in the economy are to be found.”
Morrison said there are three areas where the Government can develop policies which support emissions reduction in the built environment, these are:
- Provide deeper incentives for energy efficiency across Australia, leveraging the work by states like NSW and VIC with successful energy efficiency schemes.
- Reform our energy markets to be flexible to innovation in energy technology and responsive to community needs. We need to recognise the potential for distributed energy generation and storage, and fairly reward energy export from onsite generation.
- Commit to a trajectory for future upgrades of the National Construction Code. Aligned with Government’s commitment to introduce ‘review and refine’ cycles for climate policy, COAG should commit to a net-zero emissions trajectory for the minimum energy standards in the Code to be implemented within the established three-yearly review cycle.